Alibaba to buy up to 10% stake in duty-free retailer Dufry

Bloomberg October 5 | Updated on October 05, 2020 Published on October 05, 2020

Alibaba Group Holding Ltd agreed to buy as much as a 9.99 per cent stake in Dufry AG, giving the Swiss travel retail giant a lifeline as the pandemic hammers the company’s business.

Dufry said on Monday it’s proposing a capital increase that will raise up to 700 million Swiss francs ($763 million), and Alibaba will participate. Advent International Corp., a private equity company, also plans to invest as much as 455 million francs.

The Swiss company said the proceeds from the share sale will help it buy out its Hudson Ltd US unit, as previously announced.

The capital increase will bolster the company, whose market value has dropped to 1.6 billion francs as the shares trade near the lowest in a decade. The companies are also forming a joint venture in China that will combine Alibaba’s digital capabilities and network with Dufry’s travel retail business in that market.

Dufry employs about 31,000 people and said in June it plans to reduce personnel expenses by 20-35 per cent as revenue plummets.

Alibaba has spent billions acquiring slices of brick-and-mortar retail chains, seeking to broaden its reach in an attempt to use its technology to modernise physical commerce.

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Published on October 05, 2020
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